US Stocks Mixed as Tech Drags Nasdaq: Apple, Tesla Lead Decline Amid Sector Rotation

Market Overview: Tech Weighs on Nasdaq, Dow Relatively Resilient

On Wednesday (February 12), the three major U.S. stock indexes closed mixed, with a notable divergence in market performance. The Dow Jones Industrial Average edged higher, while the Nasdaq Composite and the S&P 500 recorded losses, with technology stocks being the primary drag. According to market data, the Nasdaq led the declines, and the S&P 500 also fell due to a pullback in heavyweight tech names, while the Dow managed to hold gains, supported by solid performances in the energy and financial sectors.

This divergence reflects a rotation of capital from high-valuation growth sectors to value and cyclical sectors. After digesting the latest inflation data and remarks from Federal Reserve officials, investors have slightly adjusted their expectations for the interest rate path, prompting a reassessment of valuation pressures on tech stocks.

Tech Stocks Lead Decline: Apple and Tesla in Focus

Large-cap tech stocks broadly came under pressure today, with Apple and Tesla experiencing particularly notable declines. Apple's stock fell for a second consecutive day, as concerns over slowing demand growth for its core products and supply chain cost pressures weighed on sentiment, despite the company's recent strong performance in its services business. Tesla continued its recent volatility, with a significant drop in share price, as doubts persist over its delivery guidance and the commercialization of its autonomous driving business. Some institutions have lowered their price targets.

Additionally, AI-related leaders such as Nvidia and Microsoft also saw varying degrees of pullback, dragging down the Nasdaq. Analysts point out that tech stocks had risen significantly earlier and are trading at historically high valuations. With the interest rate outlook still uncertain, profit-taking pressure has been released in a concentrated manner.

Reasons for Divergence: Rate Expectations and Sector Rotation

The core reason for today's market divergence lies in marginal changes in interest rate expectations. The latest CPI data released by the U.S. Department of Labor met expectations, but core inflation remains sticky, prompting the market to push back its bets on the first Fed rate cut from March to June. This shift directly impacted the valuations of rate-sensitive tech stocks, while cyclical sectors such as energy and industrials gained support from expectations of economic resilience.

At the same time, signs of capital rotation are evident. According to data from fund flow monitoring institutions, tech stock ETFs saw net outflows over the past week, while financial and energy ETFs recorded net inflows. This rotation was confirmed in today's trading: energy stocks rose on the back of a rebound in international oil prices, and financial stocks strengthened as U.S. Treasury yields moved higher.

Outlook: Focus on Earnings and Policy Signals

Looking ahead, market attention will shift to upcoming earnings reports from major tech companies and remarks from Federal Reserve officials. Apple, Tesla, and others are set to report quarterly results over the next two weeks, and their guidance will be key to testing tech valuations. Meanwhile, the Fed Chair's testimony before Congress and the February non-farm payrolls data will provide more clues about the interest rate path.

On the technical side, the Nasdaq has broken below key short-term moving average support. If it fails to recover quickly, further adjustments could follow. The S&P 500, however, has strong support near the 5100 level, and if cyclical sectors continue to gain momentum, the index may maintain high-level consolidation. Investors should be wary of high volatility risks and manage their positions prudently.